Kickstart for Vietnam

PUBLISHED : Tuesday, 30 September, 1997, 12:00am
UPDATED : Tuesday, 30 September, 1997, 12:00am

Although the real direction of the Vietnamese Government will not be seen until we know who will hold the key post of Communist Party General Secretary, Prime Minister Phan Van Khai's new Cabinet takes the country a step nearer to a free market economy. Do Muoi, Vietnam's top leader, is 80 and has repeatedly called for young blood to revitalise the country. But he may not serve out his term, which ends in 2001, and progressives fear he could be replaced by a conservative who might again apply the brakes.

Mr Phan's five deputies, all younger and better educated than their predecessors, are expected to step up the pace of economic reform. The old guard were apparently unable to resolve the conflict between communist ideology and the realities of economic globalisation. It proved impossible even to agree on replacements for the top three leaders.

With those disputes now ended, a reformist premier with a like-minded team, given a free rein, should be able to strip away the bureaucratic red tape that has stagnated progress and driven foreign investors away.

Faced with its present problems, the Government has little choice but to tackle the rampant corruption and the economic ills that have lost the country US$370 million in Japanese investment alone. It was local corruption and excessive taxation which sparked demonstrations in northern Thai Binh, where rice farmers were joined by former soldiers and retired workers.

For the majority of people, however, life is improving. The shops are full of consumer goods and an increasing section of the population has money to spend. Expectations are rising. The public want greater accountability in government and a clean-up of the police, with an end to the drug culture and widespread prostitution.

The push for change was also evident at the National Assembly this week when the legislature refused to allow the head of the state bank to remain in office. This is only the second time a government proposal has been rejected, indicating that members are no longer content to perform a rubber-stamp role. But the new regime will only be effective if the older leaders realise they cannot cling to the redundant ideology of the past. Reform of state enterprises is crucial to kick-starting the economy. It must also be swiftly carried out in the banking sector, which is saddled with massive debts from the state enterprises.